CNBCCasablanca Capital chairman Donald Drapkin joined Carl Icahn on CNBC last month to propose a shakeup of Mentor Graphics. "It's just a sleepy company," Drapkin said, "run like a country club."

Activist investment fund Casablanca Capital withdrew its three nominees for Mentor Graphics' board this morning, a tactical move aimed at consolidating support for three other candidates nominated by billionaire Carl Icahn.

This morning, Casablanca said in a regulatory filing it was pulling its nominees "to avoid shareholder confusion that could arise from multiple nominations," and the firm endorsed Icahn's three nominees.

The decision eliminates any possibility that six outside nominees could take over Mentor's eight-member board. But that was always a longshot, since Casablanca and Icahn together hold just about 20 percent of Mentor's stock.

"There was never any chance of a clean sweep," said Tom Diffely, an investment analyst who follows Mentor Graphics for D.A. Davidson in Lake Oswego.

Casablanca has a 5.5 percent stake in Mentor, and Icahn controls almost 15 percent. They have argued that Mentor spent too much money and hadn't delivered for shareholders.

By narrowing the field of outsiders to three, Diffely said, the outsiders increase their chances of getting at least one board member on Mentor's board to press the activists' case for cutting costs.

Last year, responding to Icahn's growing stake in Mentor, the company adopted a "poison pill" that effectively limits shareholders' stake in the company to 15 percent. Icahn and Casablanca have indicated they're not working together; coordination would bring their interest in Mentor above the 15 percent threshold and trigger defensive measures to prevent a hostile takeover.

The outsiders argue that Mentor's costs are too high relative to others in its industry. Casablanca chairman Donald Drapkin appeared with Carl Icahn on CBNC last month and called Mentor "a sleepy company, run like a country club."

In a conference call with investment analysts last month, though, Mentor executives conceded that their costs are too high and pledged a renewed effort to contain expenses. But they emphasized that Mentor's performance has improved, and its share price has quadrupled over the past two years.

Shares fell 35 cents today to close at $15.18.

When Icahn built his stake in Mentor between April and August last year, Mentor shares were generally trading between $8 and $9.

With the stock price up, financial results improving, and the company publicly committed to cutting costs, Diffely said Icahn might be satisfied with a single board seat.